Beaches, Sunshine, and Public Sector Pay: Theory and Evidence on Amenities and Rent Extraction by Government Workers

• 成果类型: Article
• 署名作者: Brueckner, Jan K.; Neumark, David
• 署名单位: University of California System; University of California Irvine
• 刊物名称: AMERICAN ECONOMIC JOURNAL-ECONOMIC POLICY
• ISSN/ISSBN: 1945-7731
• DOI: 10.1257/pol.6.2.198
• 发表日期: 2014
• 页码: 198-230
• 关键词: quality-of-life; Tax competition; capitalization; PRODUCTIVITY; leviathan; seeking; IMPACT; wages

摘要

Rent extraction by public sector workers may be limited by the ability of taxpayers to vote with their feet. But rent extraction may be higher in regions where high amenities mute the migration response. This paper develops a theoretical model that predicts such a link between public sector wage differentials and local amenities, and the predictions are tested by analyzing variation in these differentials and amenities across states. Public sector wage differentials are, in fact, larger in the presence of high amenities, with the effect stronger for unionized public sector workers, whose political power may allow greater scope for rent extraction.